CBN Governor Confirms Plans To Create New Bank, Streamline Number of BDC Operators in Nigeria
- The Central Bank of Nigeria (CBN) is set to introduce a singular foreign currency (FCY) gateway bank
- This bank will centralise all correspondent banking activities and facilitate international trade and economic activities
- The CBN is also planning to streamline the number of BDC operators in Nigeria, improve the nation's forex inflows and stabilise the Naira.
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Legit.ng journalist Dave Ibemere has over a decade of experience covering Tech, Energy, Stocks, Investments, and the Economy.
The Central Bank of Nigeria (CBN) governor, Yemi Cardoso, believes Nigeria needs a singular foreign currency gateway bank that will centralise all correspondent banking activities.
Governor Cardoso expressed this view during a TV interview where he addressed several bank policy initiatives.
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According to Investopedia, a correspondent bank is a financial institution that acts as an intermediary between domestic and international banks.
What CBN governor said on Gateway bank
In the interview, Cardoso explained that the single FCY gateway bank will centralise all correspondent banking activities currently dominated by two major banks in the corresponding banking space.
Legit.ng understands that Citi Bank and UBS serve as correspondent banks to many Nigerian banks.
He further noted that correspondent banking will facilitate international trade and economic activities by enabling domestic banks to conduct business and provide services to their clients across borders.
His words:
“Introducing a single FCY gateway bank to centralize all correspondent banking activities, currently dominated by two major banks in the corresponding banking space.”
CBN governor also stated that the gateway bank will serve as a medium-term strategy for fixing Nigeria's forex challenges.
More changes expected from CBN
Cardoso also mentioned that he is devising strategies to revamp the Bureau de Change (BDC) segment of the forex market.
He said the aim was to streamline their numbers for better management and supervision and to enhance their efficiency.
In response to the evolving digital finance landscape, the CBN is intensifying its efforts to strengthen surveillance and technological capabilities to monitor cryptocurrency transactions effectively.
The CBN governor said:
“Our policy focus is on achieving rate stability and maintaining market flexibility and liquidity.
"We aim to create a more efficient and transparent FX market to boost investor confidence and reduce market volatility."
Access Bank acquires Standard Chartered Bank
In another development, Legit.ng reported that Access Bank and Standard Chartered Bank had reached a deal to purchase Standard Chartered's stake in its subsidiaries in Angola, Cameroon, The Gambia, and Sierra Leone, as well as its business, private, and consumer banking operations in Tanzania.
The Central Bank of Nigeria's (CBN) approval for the transactions is still pending.
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Source: Legit.ng
